Did musicians lose the battle? - Part 1

It is fascinating how dramatic the music industry business model has changed a lot in the last 20 years, and continue to do so. The implications are huge: people got used to download music for free, the internet companies, without any knowledge or investment in music business got to the point where they control the distribution and take a large cut of the revenues, the labels who used to control the market and make most of the money (in all honesty, they also helped launch and supported many acts), failed to adapt and reacted pretty slow to the changes, suffering loses, and musicians are robbed of the fruits of their work by almost everybody.

It’s not like it’s different than any other parts of the economy: the musician’s income decreases steady, while corporations are making money, and their executives walk away with millions. It is the new norm, the corporate world norm. The only difference is that, unlike in other industries where the manufacturing is outsourced in countries with cheap labor, music can’t really be outsourced easy, so in music the price was forced down mainly because people got used to download for free and there are all these internet players (stores, radio/streaming) changing the delivery system and forcing to move a larger chunk of revenues more and more in their pockets. These new guys in town (the internet gorillas, the internet outlets and streaming) have the full attention of the users, who are spending so much time in front of their computers, mobile phones, tablets, and, through convenience and sophisticated methods, they were successful at creating the new model for delivery.

They need to offer interesting things to users, which in turn pay for internet access and various other services. Music is one of these things… if you don’t have a presence on internet you do not exist, on the other hand, there is not too much financial motivation except the marketing to do it. We live in the digital age, period.

The usual record stores were (and are) disappearing fast, from large chains to mom and pop stores, the feeling of community disappeared and it’s replaced with a virtual community, easy to control… and who really has the desire to control? I let you formulate the answer… As the income from record sales decreased, the majors (and the indies too to a large extent) started to cut costs: read smaller budgets for artist development, new contract terms – like the 360 – where they get a larger share, cashing in merchandises, concert revenues, publishing copyrights, etc. That triggers down a whole new approach, and it’s not necessarily good news.

It is another way of the old adagio that market should be left alone, without any regulation… and guess, who’s making the lion’s share? So, essentially, you as a musician you’re up against the big guys, the corporate world. Looking at how the evolution of copyright licenses price changed, how laws were drafted (ISP are not held responsible in any way), it seems like an assault on the income of the working musician. Unlike manufacturing sectors, like clothing, automotive, electronics, music can’t be really subcontracted to third world countries, not because their musicians are not good, but because I don’t think that guys playing music in Asia are so proficient at jazz, blues, hip hop, R&B, etc, it takes time, investment, education, patience, nothing gets built overnight.

However, not everything is bad news, as long as there is still left some internet democracy… I know it sounds crazy, but there is a huge effort from the big guys to control the internet, and that would be really bad. And here is why: it is easier than at any point in time to market yourself, to promote and sell your music! It’s true, you have to learn the business side of it, and that is not easy! Most of the musicians are reluctant to this aspect, however, the same way some jobs disappear and people have to go and learn how to do something else, musicians have to sharpen some business skills! In the end, there is nothing like changing completely a career, you just have to add to what you’re doing, but there are huge rewards into it: you take control of your music and your promotion, and you can give this control only to the extent you find it appropriate; if things go well, you may ask for some PR or act management services, etc.

Everything tends to become bigger these days, like a huge giant, but remember, the bigger the giant, the faster and aggressive his demise! Imagine for a second that everybody sells his music from their website, that everybody stops getting into iTunes, Spotify and the likes. They will dismantle within one week! That’s not to say that they are not useful; their reach is beyond the average musician, however, they still sell your music, not theirs! Again: they are selling your music and not theirs! This is the most important thing my friends; if they can do it, why can’t you?

PS: The whole story with the Apple Music and Taylor Swift left me somehow wondering: I feel that it is either a genius move from Taylor, telling Apple that they should continue their business model based on perceived value, as they always did it, not like the other companies that are fighting lowering the price, and, in saying so, she really hit to the core of Apple philosophy, or a marketing strategy drawn behind the close doors. The future may not tell us the whole story.

Saty tuned,

Flo Fandango


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